Andorra Private Companies:

Andorra Societat Limitadad (SL):

The Societat Limitadad (SL) is commonly used for local trading and requires a minimum paid up share capital of 6,000 euros, with a minimum of two shareholders. In order to set up an SL, the first step is to obtain approval of the proposed name (some generic words are banned). The name, once approved and registered, will have local protection.

The company's Memorandum and Articles ('estatuts' and 'rao social') are then presented to the Government ('Andorra Govern') in a petition ('suplica') for incorporation. This step is straightforward when a holding company is being created for local assets, but if local trading or complex external financial situations are involved, the Government may look closely, particularly if the foreign party (who is being given 'rights' by the titular) is a newcomer or non-resident.

Once the Government's approval is given, the capital can be deposited and a notary will formalise the incorporation, along with the 'nominee' paperwork.

If there is to be actual trading or other tangible activity in Andorra, the company will need to apply via a 'suplica' to the Commercial Register in the appropriate commune for a trading license, or 'Registre de Comerc' permission. Finally, the Commune has to approve the premises proposed to be used, which requires further paperwork . . .

Once everything is in place, the Government becomes involved once more (another suplica) to approve the formal opening of the business.

It can be imagined that this whole process will take some months even if everything goes smoothly; if not, it can take a year or more. However, for a straightforwad holding company, it may be only two or three months.

The Government's annual fee (tax) for the registration of an SL is 463 euros, and if a Registre de Comerc is needed, a further 670 euros is due annually. It can be imagined that professional fees will add substantially to these costs due to the formality and complexity of the process.

Andorra Societat Anonima (SA):

The Societat Anonima (SA) is usually created for larger types of company, or those with many shareholders, and must have a minimum paid up share capital of 30,000 euros.

The formation procedures for an SA are the same as for a Societat Limitada (see above) except that Governmental checks will be more stringent; and the annual fee (tax) for registration is 1,000 euros.

Andorra Societat Colectiva:

The Societat Colectiva is a company whose capital is shared between partners with unlimited responsibility. Its formation procedures are similar to those of the SA and SL.

Andorra Branch:

Only insurance companies can established branch offices in Andorra. See Offshore Legal and Tax Regimes for further details.

updated: 16.07.07